COMMISSIONER OF INCOME TAX V. SV GOPALA AND OTHERS [2017] (SUPREME COURT): CBDT does not have the power to amend legislative provisions in exercise of its powers under section 119 of the Income-tax Act, 1961 by issuing a Circular

Issue:

Does the Central Board of Direct Taxes (CBDT) have the power to amend legislative provisions through a Circular?

Facts:

The CBDT had issued a Circular invoking the powers under Section 119 of the Income-tax Act, 1961. The Circular amended the provisions contained in Rule 68B of the Second Schedule to the Income-tax Act, 1961 relating to time limit for sale of attached immovable property.

Supreme Court’s Decision: The Supreme Court observed that the CBDT does not have the power to amend legislative provisions in exercise of its powers under section 119 of the Income-tax Act, 1961 by issuing a Circular. The Supreme Court, accordingly, quashed the circular for being ultra vires.